Friday, October 25, 2013

NVOCCs Penalized for Law Violations

Three Southern California-based non-vessel-operating common carriers (NVOCCs) have been fined by the Federal Maritime Commission after investigations found alleged violations of the Shipping Act of 1984, the FMC revealed Oct. 22.

UTi, United States Inc., a licensed NVOCC and freight forwarder headquartered in Long Beach, California, submitted a voluntary self-disclosure to the Federal Maritime Commission disclosing potential violations of 8(a)(1) of the Shipping Act arising from a failure to maintain a general tariff covering all points or ports on its own routes and on any through transportation routes established.

Based on the company’s self-disclosure and remedial measures voluntarily undertaken, a compromise agreement was reached under which UTi United States paid a $140,000 fine to settle the case.

East-West Logistics, a licensed NVOCC located in La Mirada California, was alleged to have violated section 10(a)(1) of the Shipping Act of 1984 by knowingly and willfully obtaining ocean transportation for property at less than the rates and charges that would otherwise be applicable by “misdescribing” the commodities shipped under certain service contracts and by improperly obtaining reduced rates limited to certain named accounts under certain service contracts.

In addition, East-West Logistics violated section 10(b)(2)(A) of the Shipping Act by providing service other than at the rates and charges in its NVOCC tariff. The company made a payment of $55,000 to settle the allegations.

El Monte, California-based Versatile International Corp., doing business as King Yang Shipping, was alleged to have knowingly and willfully violated section 10(a)(1) of the Shipping Act by engaging in cargo misdescription activities involving inbound shipments to the West Coast; and to have violated section 10(b)(2) of the Shipping Act by providing service that was not in accordance with the rates or charges contained in Respondent’s NVOCC tariff. Versatile made a payment of $55,000 to settle the allegations.

In addition, an NVOCC based in Long Island, NY, one in Taiwan and two in China were also fined for various Shipping Act violations, including service contract, tariff and bond violations. The FMC says that in total, it recovered over $617,000 in penalties.